Problem Formulation

A problem well defined is a problem half solved!

Failure to properly identify where you are headed and

why will inevitably lead you to wonder where you are
and how you got there! Wren
Management Problems vs. Research Problems

 Most marketing research problems manifest themselves as

Management Decision Problems
 Situation arises, management needs to make a decision,
requires research, starts the research process
 No actionable guidance
 Simply a statement of the issue that management is
dealing with
 Must restatement in research terms.
Management Problems vs. Research Problems
 Marketing Research Problem: a statement of the information needed
by a decision maker to help solve a management decision problem.

 Most critical part of the mktg. research process

 Provides guidance and direction for research process
 See Exhibit 4.1 for examples of the difference
 Tips for Accurately Defining
Research Problems

 Find out why the information is being sought.

 Determine whether the information already exists.
 Determine whether the question really can/should be
answered.
 Use exploratory research to define background of the
problem
 Situation analysis
 The iceberg principle
 Determine relevant variables
 Definition of Research Objectives
 Marketing Research Objectives: the specific bits of knowledge that need
to be gathered to close the information gaps highlighted in the research
problem.
 Stated in action terms
 Serve as a standard to evaluate the quality and value of the research
 Objectives should be specific and unambiguous
 Examples:
 To measure the number of college freshmen at UAH
 To assess viewer recall of our ad campaign
 To describe the segments of the marketplace
 Putting It All Together

 Management Problem
 Placement office has noticed, while major companies make annual recruiting visits to campus for engineers, not
many national or local companies are formally recruiting business majors through the placement office
 Why? How do we address this?
 Marketing Research Problems
 Why are companies not taking advantage of the resources that the placement service offers? Are companies going
around the service?
 Are companies aware of the UAH placement service?
 Are companies aware of the reputation of the UAH Business School?
 What kind of things might generate more recruiting activity?
 Marketing Research Objectives
 To determine to what extent companies are aware of the UAH placement service
 Determine whether companies, especially locals, are aware of the strong reputation of the UAH Business School
 To determine whether a quarterly newsletter highlighting UAH business programs and students might generate
more recruiting activity.
 Another Example

 Management Problem
 What price should we charge for our new product?
 Research Problem
 What are our costs of production and marketing (COGS)?
 What are our pricing objectives and position in the market?
 What price does similar types of products sell for?
 What is the perceived value of our product in the marketplace?
 Are there any norms or conventional practices in the marketplace
(e.g., customary prices, continual discounting)
 Research Objectives
 To assess the costs involved in producing and selling our product
 To determine corporate objectives and their implications for
pricing
 To examine current prices for direct and indirect competition
 To determine potential customer reaction to various prices and
their perception of the benefits of owning the product
 Practice, Practice

 For the following management problems, identify the

underlying research problems and a couple of research
objectives.
 “Should our retail chain offer online shopping?”
 “What advertising media should we use to reach
our market?”
 “How do we get more people to attend our outdoor
festival/event?”
 “Should we build a new warehouse to store our
excess inventory?”
 Practice, Practice (cont’d)

 For the following management problems,

identify the underlying research problems and
a couple of research objectives.
 “How can we increase customer retention?”
 “Should the amount of in-store promotion
for an existing product line be increased?”
 “Should the compensation package be
changed to better motivate the sales force?”